The turnaround time for appraisals has always been a problem in the mortgage process, and during boom periods when transaction volumes skyrocket, turnaround times frequently suffer. For instance, specific markets saw evaluation delays of three to six weeks in 2020 and 2021. Although, turn times are getting better as the market calms down.
The appraisal process has frequently struggled to keep up with the other parts of the mortgage process as they grow more organized and effective. Using several appraisal models is a crucial strategy for reducing the duration of appraisals. This enables you to scale the number of appraisals you can complete with your present appraiser population, which is a crucial component of all ongoing modernization efforts. For instance, hybrid and desktop appraisals, which were made permanent options for loans in March 2022, significantly reduce cycle times.
The Automated Collateral Evaluation Plus Property Data Report (ACE+ PDR) product from Freddie Mac, which has been used since July of this year and comprises an inspection-based waiver, is another appraisal innovation. While the GSE requires users to go out and get property data, in most cases, no appraisal is necessary once that data has been gathered, reducing cycle time.
Currently, there are only a small number of 40,000 active, licensed appraisers compared to the volume of transactions taking place. The usage of the available appraisers can be improved with the use of other valuation models. Lenders are urged to utilize the new evaluation tools that are now offered. With the right technology stack, effective management of appraisal pipelines, and the right partners and vendors, lenders can reduce the time to complete appraisals. Click here to read more.
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